Letter 1153 – Proposal to Assess Trust Fund Recovery Penalty

What It Means:

The IRS sends Letter 1153 to individual taxpayers responsible for collecting and paying payroll taxes. The letter notifies them that the government is holding them personally liable for the unpaid business tax debt under a penalty known as the Trust Fund Recovery Penalty (TFRP). Since the IRS has identified you as a “responsible person” for the unpaid trust funds taxes, the IRS may seize your personal assets, garnish your wages, or take other actions to pursue the amount due.

Next Steps:

Be sure to review Letter 1153 thoroughly. Do not ignore it. You must take immediate action to avoid being assessed the Trust Fund Recovery Penalty.

You Have Three (3) Main Options:

1. Speak with a Tax Professional. Due to the seriousness of this notice/letter, you should speak with a tax professional before taking any action. A tax expect can determine if you are legally responsible for the business tax debt and negotiate a resolution if you are liable.
2. Agree to the penalty. You can sign and return Form 2751 (included with Letter 1053), if you are certain that you are responsible for the trust fund taxes.
3. Appeal. If you disagree, you can file a formal protest with the IRS Office of Appeals within 60 days of the letter’s date.

Another option is to contact the revenue officer listed in the letter. This must be done within 10 days of receiving the letter. It’s an informal process that may help resolve the matter before the penalty assessment begins.

Need Help?

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